Summary

Summary of Report on Financial Statements

The Broward County District School Board prepared its basic financial statements for the fiscal year ended June 30, 2006, in accordance with prescribed financial reporting standards.

Summary of Report on Internal Control and Compliance

The District has established and implemented procedures that generally provide for internal control of District operations.  The District generally complied with significant provisions of laws, administrative rules, regulations, contracts, and grant agreements.  However, we did note internal control and compliance findings that are summarized below.

Summary of Audit Findings

Finding No. 1:        Budget Administration

Final budget overexpenditures were noted in the District’s General and Special Revenue funds for the 2005-06 fiscal year.

Finding No. 2:       Tangible Personal Property

Deficiencies were noted in the tangible personal property controls relating to annual physical counts, tagging of property items, updating necessary fields in the property records for acquisitions and dispositions, and monitoring of surplus property.

Finding No. 3:       Internal Audit Function

To enhance independence, Board policies should allow for the District’s internal auditor to independently report instances of suspected fraud, abuse, and improper acts and expenditures to the appropriate law enforcement agencies.

Finding No. 4:       Land Acquisitions

Documentation relating to pricing notification to the Board for land acquisitions and signed negotiating parameters forms were not maintained by the District staff.

Finding No. 5:       Monitoring of Charter Schools

The insurance coverage required in the District’s standard charter school agreements was not always maintained by the individual charter schools.  Multiple charter schools managed by a single organization used the same insurance policy.  The language in the Board Policy and standard charter school agreement was inconsistent regarding the District being named as an additional insured.

Finding No. 6:       Annual Facility Inspections

Deficiencies reported in the annual facilities inspections were not always timely corrected.   Communication issues between the affected departments delayed some of the corrections. 

Finding No. 7:       Relocatable Buildings

Structural integrity inspections were not conducted for all District relocatable buildings during the 2005‑06 fiscal year.

Finding No. 8:       Fingerprinting Requirements

The District was not following the Florida Department of Education guidance regarding procedures for background screenings of instructional employees. 

Finding No. 9:       Sick Leave Banks

The District did not follow its sick leave bank guidelines regarding replenishment of the banks, resulting in three of the five sick leave banks having deficit balances at June 30, 2006. 

Finding No. 10:     Salary Overpayments

As of June 30, 2006, cumulative payroll exceptions analyzed and determined to be salary overpayments totaled $2,289,665, of which $1,849,775 has been collected and $439,890 remains uncollected.  The overpayments were the result of errors associated with employee terminations, leaves of absence, changes in pay, and addition/deletion of hours.

Finding No. 11:     Overtime Payment Monitoring

Overtime payments made by the District for the 2005-06 fiscal year totaled approximately $11.9 million.  Detailed overtime reports are available for review and analysis by supervisory level staff; however, there is no Board policy or procedure requiring a review or analysis of overtime payment information by supervisory level staff to ensure staffing levels are adequate and timely detect any errors, waste, or fraud that may occur.

Summary of Report on Federal Awards

We audited the District’s Federal awards for compliance with applicable Federal requirements.  The Food Donation, Child Nutrition Cluster, Vocational Education, Twenty-First Century Community Learning Centers, Disaster Grants, and Student Financial Assistance Cluster programs were audited as major Federal programs.  The results of our audit indicated that the District materially complied with the requirements that were applicable to the major Federal programs tested.

Audit Objectives and Scope

Our audit objectives were to determine whether the Broward County District School Board and its officers with administrative and stewardship responsibilities for District operations had:

• Presented the District’s basic financial statements in accordance with generally accepted accounting principles;

• Established and implemented internal control over financial reporting and compliance with requirements that could have a direct and material effect on the financial statements or on a major Federal program;

• Established management controls that promote and encourage: 1) compliance with applicable laws, administrative rules, and other guidelines; 2) the economic, effective, and efficient operation of the District; 3) the reliability of records and reports; and 4) the safeguarding of District assets;

• Complied with the various provisions of law, administrative rules, regulations, and contracts and grant agreements that are material to the financial statements, and those applicable to the District’s major Federal programs; and

• Corrected, or are in the process of correcting, all deficiencies disclosed in our report Nos. 2004‑173 and 2005-020, and in the report of other auditors for the 2004-05 fiscal year.

The scope of this audit included an examination of the District’s basic financial statements and the Schedule of Expenditures of Federal Awards as of and for the fiscal year ended June 30, 2006.  We obtained an understanding of internal control and assessed control risk necessary to plan the audit of the basic financial statements and Federal awards.  We also examined various transactions to determine whether they were executed, both in manner and substance, in accordance with governing provisions of laws, administrative rules, regulations, contracts, and grant agreements.

Audit Methodology

The methodology used to develop the findings in this report included the examination of pertinent District records in connection with the application of procedures required by auditing standards generally accepted in the United States of America, applicable standards contained in Government Auditing Standards issued by the Comptroller General of the United States, and Office of Management and Budget Circular A-133.

The Superintendent's response to the audit findings and recommendations is included in the full report.